Yesterday’s signals were not triggered, as there was no bullish price action when 107.29 was reached.
Today’s USD/JPY Signals
Risk 0.75%.
Trades must be entered from 8am New York time to 5pm Tokyo time, during the next 24 hours only.
Short Trade
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 108.05.
Place the stop loss 1 pip above the local swing high.
Adjust the stop loss to break even once the trade is 20 pips in profit.
Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.
Long Trade
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 106.14.
Put the stop loss 1 pip below the local swing low.
Move the stop loss to break even once the trade is 20 pips in profit.
Take off 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to ride.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
USD/JPY Analysis
Yesterday I took a bearish bias and noted this pair was at the heart of the Forex market. This was and remains a correct approach, and the pair remains in focus. The price made a further strong downwards movement to a new 15-month low price at 106.84, from where it is now pulling back. This downwards movement broke the lower trend line of the descending channel shown in the price chart below, which is an additional bearish sign. The price may now continue to pull back, but there is no reason not to keep a bearish bias below 108.05. All the signs are bearish, and there is no key support until 106.14, so the price has room to fall further, with the line of least resistance looking clearly downwards.
I maintain a bearish bias and this pair is likely to remain at the heart of the Forex market again today.
There is nothing due today concerning the JPY. Regarding the USD, there will be releases of CPI and Retail Sales data at 1:30pm London time.